According to the Internal Revenue Service, W-2 forms should be mailed out to employees by no later than January 31 for forms derived from the previous calendar year. While employees may not receive them in the mail on this date, they must -- at the very least -- be sent out at this point. For companies that do not follow this particular protocol, there can be consequences.

Disgruntlement

Aside from any official issues you may have with the Internal Revenue Service (IRS) due to failure to send out W-2 forms in a timely fashion, you may have to deal with a group of very disgruntled employees, many of whom are likely expecting a tax return. Employees may not only make complaints to you but also to the IRS, which may spur further investigation into your company if numerous complaints are made about the issue.

Fines

A few days past the deadline may not result in any action taken against your company; however, if you go too long without sending out those W-2s, the result could be a $250 fine from the IRS (as of July 2011) for each form filed late. There is no maximum penalty, which means that you could pay in excess of thousands of dollars for sending out your employees' W-2 forms after the January 31 deadline.

Accurate Form

In addition to sending the W-2 forms out on time, you must also ensure that said forms are accurate. According to the IRS website, if you submit a W-2 form to the IRS claiming that you paid a particular employee a certain amount of money and you did not, that person has the right to sue you for damages. You may also have to pay a fine of $5,000 for filing the false document.

Considerations

Sometimes, if you at least let your employees know that you are running behind with your W-2s but are working on getting them out, there may be less discontent than if you don't say anything at all. Also, if you send out a W-2 by the deadline, but have it returned to you for a bad or old address, don't open it or throw it away. Put it in the employee's file and save it in case he contacts you for the form down the road; you at least have proof that you tried to send it.

About the Author

Lynda Moultry Belcher is a writer, editor and public relations professional. She worked for a daily newspaper for 10 years and has been a freelance writer for more than 15 years. She has contributed to Divorce360 and Revolution Health Group, among other publications. She is also the author of "101 Plus-Size Women's Clothing Tips" and writes "Style At Any Size," a bi-weekly newspaper column.